Industry Structure and Developments
ECOMONIC SCENARIO
Global Economy
The global economy is continuing to grow at a modest pace, according to the OECDs latest Economic Outlook. The Economic Outlook projects steady global GDP growth of 3.1% in 2024, the same as the 3.1% in 2023, followed by a slight pick-up to 3.2% in 2025.
The global growth will continue to be driven by emerging market and developing countries such as India. IMF has projected emerging market and developing countries to grow at 4.1% in 2024 and 4.2% compared with 1.5% and 1.8% growth in advanced economies during the same period. According to IMF projections, India will continue to be the fastest-growing large economy in the world, growing at 6.5% each in 2024-25 and 2025-26.
The upward revision in growth forecast for 2024 is on account of stronger-than-expected economic growth in the US and some major emerging market and developing economies in the second half of 2023, helped by government and private spending.
The global financial system has broadly withstood the unprecedented monetary tightening across the world with the resilience of emerging market economies, which were at the receiving end of the previous episodes of volatility, standing out. The global economy is still not out of the woods with the growth forecasts for 2024 and 2025 significantly below the historical average of 3.8% during 2000-2019.
Indian Economy
Despite facing headwind from the sluggish global economy, the Indian economy continue to stand out as the fastest growing large economies and there is every sign that this trend will continue in the near to medium term. Indias economic growth trajectory has garnered global attention as the renowned ratings agency S&P Global has revised its outlook on the country from stable to positive. This development reflects the agencys assessment that policy stability, deepening economic reforms, and robust infrastructure investment will sustain Indias long-term growth prospects.
With public investment and consumer momentum being the key drivers of near-term growth, targeted economic policies are required to shape Indias trajectory toward achieving its aspirations of being the third largest economy by 2027 and securing sustainable economic growth. The Reserve Bank of India expects Indias real GDP to grow by 7% in 2024-25 and remain the fastest-growing among major economies in 2025. Currently, Indias GDP is estimated to be around USD 3.7 trillion. India will likely see improved capital flows boosting private investment and a rebound in exports.
Despite global economic uncertainties, geopolitical tensions (Russia-Ukraine War), disruption in supply chains (Red Sea Crisis) and tightening financial conditions in major economies like the US, Indias domestic demand has remained relatively resilient.
The focus of the Interim Budget for 2024-25 has been on fiscal consolidation. The Budget has projected an accelerated reduction of fiscal deficit to 5.8% of GDP in 2023-24 and 5.1% of GDP in 2024-25, while continuing its focus on capital expenditure. The government, which has nearly tripled its capital expenditure in four years, is now aiming a 17% growth in 2024-25 to Rs.11.11 lakh crore. With this, capital expenditure as a percentage of GDP is projected to double to 3.4% in 2024-25 from 1.7% in 2019-20, pointing to the qualitative improvement in the Indian governments finances.
Firm GDP growth forecasts, inflation at manageable levels, political stability at the central government level, and appreciable central bank monetary policy, have all contributed to painting a bright picture for the Indian economy in recent quarters.
Indias appeal as a destination for investments has grown stronger and more sustainable because of the current period of global unpredictability and volatility, and the record amounts of money raised by India- focused funds which are evidence of investor faith in the "Invest in India" narrative.
COMPANY OVERVIEW About us
Your Companys business is to carry out infrastructure businesses through its subsidiaries and step down subsidiaries. The infrastructure businesses include (a) Municipal Solid Waste management and Waste to Energy business which is being carried out by various SPVs under JITF Urban Infrastructure Limited; (b) Rail wagon fabrication and manufacturing business being carried out by Jindal Rail Infrastructure Limited and (c) Water and Waste Water EPC business being carried out by JWIL Infra Limited.
MAJOR SUBSIDIARIES & THEIR OPERATIONS:
The Company has interest in various infrastructure business through its subsidiaries in India and abroad. JITF Infralogistics Limited is the holding company for infrastructure business which is consisting of Water and waste water management business, Municipal Solid Waste management and Waste to Energy business, and Rail wagon fabrication and manufacturing business.
WATER AND WASTE WATER MANAGEMENT BUSINESS: JWIL INFRA LIMITED (JWIL)
Global market
The global water industry is one of the most critical sectors in the world. It not only provides drinking water and wastewater services to the global population but also supplies the industrial and agricultural sectors. Pressure on the water industry is however expected to increase in the coming years as climate change shrinks water availability worldwide while populations continue to grow. Agriculture is the sector with the highest water consumption worldwide. Such activities alone account for almost three-quarters of global water withdrawals.
According to the United Nations World Water Development Report, approximately 2 billion people worldwide lack access to clean and safe drinking water, while about 3.6 billion people lack adequate sanitation services. Ensuring access to clean water and sanitation is not only essential for individual health but also crucial for economic development and growth. Increasing investments in the water sector is, therefore, imperative for the progress of countries and regions.
The UN World Water Development Report 2023 highlights that global water usage has been steadily increasing by about 1% per year over the last four decades. This trend is expected to continue until 2050, driven by factors such as population growth, socio-economic development, and shifting consumption patterns. Most of this rise is observed in middle-income and lower-income countries. The issue of water scarcity is exacerbated by the localised impact of physical water stress and the proliferation of freshwater pollution. These challenges pose significant threats to communities worldwide and necessitate urgent action to ensure sustainable water management practices.
Because of climate change, regions traditionally abundant in water, such as Central Africa, East Asia, and parts of South America, are expected to experience increased seasonal water scarcity. Simultaneously, areas already grappling with water shortages, such as West Asia and the Sahel in Africa, will face more water challenges.
All countries, irrespective of income level, are confronting risks associated with water quality. Statistics reveal that, on average, 10% of the global population resides in countries grappling with high or critical water stress. Low-income nations often struggle with poor ambient water quality due to insufficient wastewater treatment infrastructure, whereas higher income countries contend with agricultural runoff as a major issue.
Global warming has further aggravated this situation by directly affecting the link between water and climate change. Unpredictable rainfall, melting glaciers, rising sea levels, droughts, and floods are all consequences of climate change. Rising temperatures disrupt precipitation patterns and the entire water cycle, aggravating both water scarcity and water-related hazards.
Indian market
The NITI Aayogs 2018 Composite Water Management Index (CWMI) depicts an unsettling picture of macro-water availability in India - despite being home to 17% of the worlds population, it has only 4% of the worlds freshwater resources. The total water demand in India is projected to increase by 22% and 32% in 2025 and 2050 respectively and, by 2050, 85% of this demand is expected to come from industrial and domestic sectors alone.
Indias dependence on an increasingly erratic monsoon for its water requirements increases the challenge. Climate change is likely to exacerbate this pressure on water resources, even as the frequency and intensity on floods and droughts in the country increases. Five of the worlds 20 largest cities under water stress are in India. Average per capita water availability in India, which is already be categorised water stressed, is expected to reduce further to 1341m3 by 2025 and 1140m3 by 2050, close to the official water scarcity threshold. According to a NITI Aayog report India is at 120th position amongst 122 countries in the water quality index, with nearly 70% of water being contaminated13. According to a NITI Aayog, India will need investments of Rs.20 lakh crore to bridge the expected water supply gap by 2030.
The situation gets aggravated by rapid urbanisation and industrialisation, leading to the overexploitation of water bodies, poor water management, pollution, and climate change. The rapid growth of urban areas and industries has resulted in the overexploitation of both surface and groundwater resources. Additionally, inadequate management of water bodies and outdated irrigation techniques worsen the crisis.
Erratic rainfall patterns, rising temperatures, and melting glaciers further strain water resources, causing droughts and floods, especially in vulnerable regions. The repercussions of this crisis are far-reaching, affecting human health, economic growth, social stability, and environmental integrity.
Interstate disputes over river water heighten tensions in India, fuelling conflicts between communities and, in some cases, leading to violence.
Both central and state governments are implementing a series of measures, including promoting water conservation, policy reforms, investing in water-related infrastructure, increasing community participation, and building climate resilience.
THE NEED FOR WATER SUPPLY & WASTE WATER TREATMENT
Various reports indicate that out of Indias population of 1.4 billion people, 35 million people lack access to safe water and 678 million people lack access to a safe toilet. Extreme water stress, contaminated surface water and lack of access to piped water supply are the major challenges faced by the country currently. Water is essential for crop production. For the production of crops, freshwater resources are widely used in India. Water is important for the growth of plants throughout their life in massive quantities.
India is also currently grappling with an unprecedented water crisis. This is characterized by severe water scarcity affecting over 40% of its population. Several major cities across the country have even reached a critical point where groundwater levels have depleted to zero. This alarming situation is exacerbated by projections from the World Bank, which estimate that by 2030, Indias water demand will exceed its supply by nearly 50%. This poses a substantial challenge in meeting the water needs for both domestic and commercial purposes.
INDUSTRY OUTLOOK
The India Water and Wastewater Treatment Technology Market size is estimated at USD 1.02 billion in 2024, and is expected to reach USD 1.71 billion by 2029, growing at a CAGR of 10.78% during the forecast period (2024-2029).
Market Insights:
The water treatment market size is expected to rise from US$ 69.73 billion in 2024 to US$ 137.17 billion by 2034. The market is estimated to expand at a CAGR of 7% over the forecast period.
Market drivers:
Growing regulations against water pollution of naturally occurring water bodies & illegal wastewater discharge.
Increasing population - Needs freshwater supply & wastewater treatment facilities are needed in large Indian cities since urban population is constantly growing.
Technology - The integration of AI, IoT & Data Analytics in water supply & wastewater treatment.
Market challenges:
The high cost of water treatment plants.
The cost of wastewater treatment facility is affected by effluent flow rates, water quality, purity, and construction materials.
The demand and supply of chemicals and equipment have been negatively impacted by the increasing number of limitations imposed due to the epidemic around the world.
Recent Developments
The Government of Indias Atal Mission for Rejuvenation and Urban Transformation (AMRUT) 2.0 scheme, which has been launched on 01 October, 2021 for the period of 05 years i.e. from the financial year 2021-22 to the financial year 2025-26, is designed to provide universal coverage of water supply through functional taps to all households in all the statutory towns in the country and coverage of sewerage/septage management in 500 cities covered in first phase of the AMRUT scheme.
With a budget of $51 bn, Jal Jeevan Mission (JJM) sponsored by Government of India is working towards realizing the vision of Har Ghar Jal, and laying the foundation for a sustainable, equitable water future. However, water security goes beyond mere access. It necessitates fostering a holistic ecosystem where access is not just granted but also perpetuated through continuous efforts. By putting communities at the heart of the change process, we can make a difference.
To fulfill, JWILs moto of providing sustainable water management and be part India Inc. growth the company is exploring opportunities in following three Segments:
1) Drinking Water Projects
2) Irrigation Projects
3) Sewerage Treatment / Wastewater Treatment
4) Operation & Maintenance of Water Treatment Plants etc.
JWIL is presently active in following States:
Uttar Pradesh, Madhya Pradesh, Rajasthan, Jharkhand, Tamil Nadu, Assam, Maharashtra, Delhi and Internationally at Tanzania.
JWIL is also exploring new states for its projects such as Odisha, Haryana, Andhra Pradesh, Karnataka, Gujarat.
COMPANY OVERVIEW
During the Financial Year 2023-2024, JWIL Infra Limited (JWIL) recorded Operations Revenue of INR 2,164.25 Crores as against previous Financial Year Operations Revenue of INR 940.44 Crores, witnessing a growth of about 130% over previous year.
The Company has achieved EBITA, PBT and PAT of Rs 195.01 Crores, Rs. 160.22 Crores and Rs. 114.16 Crores respectively as against Rs. 83.58 Crores, Rs. 59.94 Crores and Rs. 42.84 Crores in previous FY 2022-23.
JWIL have also been able to maintain and improve Profitability marginally with various cost saving initiatives.
The Company is focused on Digitalization of processes along with operational efficiency and has taken various steps to achieve the same.
As a company, JWIL is doing selective bidding for new projects, based on parameters laid down by the Board in this respect. During the FY 2023-2024, JWIL has been awarded following orders worth INR 1,805 Crores to cater drinking water supply requirements:
Vidisha Project - Madhya Pradesh - INR 899 Crores Nagapattinam Project - Tamil Nadu - INR 352 Crores Pokhran Project - Rajasthan - INR 225 Crores Nashik Project - Maharashtra - INR 169 Crores Chidambaram Project - Tamil Nadu - INR 159 Crores
After considering orders received during FY 2023-2024, JWIL closing Order book as on 31st March 2024 stood for more than Rs. 4000 crores.
During the coming Financial Year 2023-2024, JWIL is targeting to complete five projects, namely Chhitakhudari, Byarma, Patyora, Guwahati (2 projects).
Incorporated in 2006, JWIL has established itself as a leading player in the Indian Water Sector in a short span of time. JWIL is a holistic water management company with strong in-house design and engineering capabilities which provides end-to-end solutions for projects in the drinking water, irrigation and wastewater treatment sectors. JWIL is growing rapidly (CAGR 50% p.a.) over the last few years and currently executing projects worth Rs. 4000 Crores. JWIL Provides water services to 20 million people across over 5000 villages connected through 10,000+ Kms of pipeline.
JWIL has grown beyond boundaries of existing business and has spread its footprint to MENA, Africa and ASEAN regions and diversified its portfolio to Desalination, Reuse, ZLD, Sludge and Solid Waste Management.
Current Water Opportunities
The Indian water sector is on the crossroads today. In a developing country with huge requirements, there is a vast scope for growth. The total Indian water market is estimated to be about USD 14 billion with a growth rate of about 18 per cent every year. At JWIL Water Infra, we are optimistic of Indias water sectors prospects and our role within. We believe that the water infrastructure has not grown even to the extent of 10 per cent of its true potential, which indicates that this single vertical holds out decades of sustainable growth potential.
Initiatives such as the Jal Jeevan Mission, aimed at providing drinking water connections to all rural households by 2024, and ambitious targets for irrigation under the Pradhan Mantri Krishi Sinchayee Yojana, are contributing factors to the sectors growth trajectory. The governments Smart City project is also a boost to the industry.
Solid Waste Management and Waste to Energy Business: JITF Urban Infrastructure Limited (JUIL)
The world faces an immense challenge in the form of expanding waste, which has reached unsustainable levels, driven by rapid urbanisation, economic growth, and shifts in consumption and expenditure patterns.
With the increasing population and industrialization, the amount of waste generated has been increasing, leading to a need for effective waste management strategies. Waste to energy provides an opportunity to reduce the amount of waste that ends up in landfills, while also generating energy. Waste to energy provides a renewable source of energy that can help reduce reliance on fossil fuels and reduce greenhouse gas emissions.
This problem has been magnified in India due to the growing population and rural-urban migration. But the worlds most populous country is doing its best to find ways to deal with the rapidly increasing waste generation. Swachh Bharat Mission 2023 data says that urban areas in India, representing about 377 million people, generate 55.6 million metric tonnes (MMT) of Municipal Solid Waste (MSW) each year. By end-2023 the Countrys urban population was expected to hit 600 million and generate 165 million tonnes of solid waste. While the collection efficiency has improved significantlyabout 70 per cent is collected countrywideMSW recovery and end-disposal processes need to be strengthened. The waste generated by cities is projected to grow by 5 per cent annually until 2050 to reach 436 MMT per year by 2050.
Industry Overview
The purpose of the global waste to energy market is to provide a sustainable solution for waste management, while also addressing the growing demand for energy. Global Waste to Energy Market size was valued at USD 38.51 billion in 2022 and is poised to grow from USD 41.40 billion in 2023 to USD 73.83 billion by 2031, at a CAGR of 7.5% during the period 2024-31.
The global waste to energy market is segmented on the basis of technology, services, and region. Based on technology, the market is bifurcated into thermal, and biological. In terms of waste type, the market is segmented into municipal solid waste (MSW), industrial waste, agricultural waste, and others. Regionwise, the market is segmented into North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.
Waste to energy Market Analysis by Technology
The thermal segment emerged as the dominant segment in the global waste to energy market, accounting for a significant revenue share. This growth was primarily driven by the widespread adoption of incineration thermal technology, which contributed significantly to the overall revenue growth. Thermal conversion techniques offer a relatively simple process with ease of operations, making them a favorable choice for waste to energy projects. Thermal treatment of waste provides an environmentally sound solution for modern cities by enabling the complete combustion of gasses released from the waste. Incineration thermal technology offers several benefits, including the limitation of greenhouse gas emissions, energy preservation, and waste volume reduction.
The biological segment is expected to exhibit the highest growth rate in the waste to energy market over the forecast period. This growth is attributed to the gradual advancement of anaerobic decomposition technology.
Waste to energy Market Analysis by Waste Type
Municipal solid waste is the largest waste type segment in the waste to energy market. It includes waste generated from households, commercial establishments, and institutions. MSW typically consists of organic waste, paper, plastics, metals, and other non-hazardous materials. The key drivers for waste to energy conversion of MSW include the increasing volume of waste generated globally and the need for sustainable waste management solutions. Waste to energy plants that utilize MSW as a feedstock can help reduce landfill waste, generate renewable energy in the form of electricity or heat, and reduce greenhouse gas emissions. MSW is a reliable and readily available waste stream, making it an attractive choice for waste to energy projects.
Industrial waste encompasses various types of waste generated from manufacturing processes, power plants, construction sites, and other industrial activities. This waste stream often contains a high calorific value due to the presence of materials such as biomass, plastics, rubber, and chemicals. Waste to energy conversion of industrial waste offers multiple benefits, including efficient waste disposal, resource recovery, and energy generation.
Waste To Energy Market Regional Insights
Europe has emerged as the dominating region in the global waste to energy market. This dominance can be attributed to several factors, including stringent waste management regulations, limited landfill space, and a strong focus on renewable energy generation. Countries like Germany, Sweden, and the Netherlands have made significant investments in waste to energy infrastructure and have well- established frameworks for waste management. The European Unions waste management targets and directives have also played a crucial role in driving the adoption of waste to energy technologies in the region. The favorable regulatory environment, along with advanced waste sorting and treatment facilities, has positioned Europe as a leader in the waste to energy market.
Asia Pacific is expected to be the fastest-growing region in the global waste to energy market. Rapid industrialization, urbanization, and population growth in countries like China and India have led to an increase in waste generation. The rising concerns over environmental pollution and the need for sustainable waste management solutions have spurred the demand for waste to energy technologies in the region
Waste to energy Market Drivers
Increasing Waste Generation and Limited Landfill Space: Rapid population growth, urbanization, and industrialization have led to a significant increase in waste generation worldwide. Limited landfill space and environmental concerns associated with traditional waste disposal methods have driven the demand for waste to energy solutions.
Stringent Waste Management Regulations
Governments and environmental agencies across various regions have implemented stringent regulations and targets to reduce landfill waste and promote sustainable waste management practices. These regulations have encouraged the adoption of waste to energy technologies as a viable solution to manage waste and generate renewable energy.
Waste to energy Market Restraints
High Capital and Operational Costs: Establishing waste to energy facilities requires substantial upfront investment and ongoing operational costs. The capital-intensive nature of waste to energy projects can pose a challenge for market growth, especially in developing regions where financial resources may be limited
India Waste to Energy Potential
According to the Ministry of New and Renewable Energy (MNRE), there exists a potential of about 1700 MW from urban waste and about 1300 MW from industrial waste. MNRE is also actively promoting the generation of energy from waste, by providing subsidies and incentives for the projects. Indian Renewable Energy Development Agency (IREDA) estimates indicate that India has so far realized only about 2% of its waste-to-energy potential.
The Indian Government has recognized waste to energy as a renewable technology and supports it through various subsidies and incentives. MNRE is actively promoting all the technology options available for energy recovery from urban and industrial wastes.
Need of WtE Plants in India:
> India is a rapidly growing economy with large scale urbanization leading to ever increasing generation of Municipal Solid Waste (MSW).
> WtE facilities divert MSW from going to landfills and reduce the quantum of waste by 90% through scientific process. Waste to Energy plants also help in reducing the release of large quantum of hazardous gases such as methane, carbon monoxide, carbon di-oxide, oxides of nitrogen etc. (Green House Gases) which lead to increase in global air temperature and adverse climate change across the World.
> India produces 277.1 million tonnes of MSW every year, which is likely to touch 387.8 million tonnes in 2030.
> A modern plant which can be implemented on a 15 Acre plot of land can consume up to 3000 MT of MSW per day and produce 40 MW of clean and green energy and saves appx 10 Acres of land per Annum.
> As on 31st Aug 2022, Renewable energy sources, including large hydropower, have a combined installed capacity of approximately 163 GW including 0.47 GW from WtE Plants (less than 0.3%).
> Despite the challenges related to quality and segregation of MSW, developers have shown interest in WtE projects.
Future Outlook and Challenges
The Solid Waste Management (SWM) sector in India has witnessed significant growth in recent years due to the governments push towards cleanliness and sanitation. The governments Swachh Bharat Abhiyan (Clean India Mission) has provided a boost to the sector, resulting in a surge in demand for waste management solutions. The market for solid waste management in India, valued at approximately $ 12 - 15 billion, is expected to grow at a CAGR of 6.5 - 7.5% during the forecast period (2025-2030).
Over the past decade the government of India, in collaboration with state governments and union territories (UTs), has initiated projects such as the Swachh Bharat Mission (SBM) and the development of 100 smart cities across the country. The Ministry of Environment, Forest, and Climate Change (MoEF&CC) also amended Indias SWM rules. These initiatives, combined with strict enforcement of the updated SWM rules by the CPCB, encourage every Urban Local Body (ULB) in India to develop effective and sustainable waste management systems and energy recovery (WtE) from waste.
The Indian Government has recognized WtE as a renewable technology (RE) and supports it through various subsidies and incentives. The Ministry of New and Renewable Energy (MNRE) is actively promoting all the technology options available for energy recovery from urban wastes. According to MNRE, the estimated energy generation potential from urban waste in India is approximately 5,690 MW. India launched the third edition of the Sustainable Development Goals (SDG) India Index and Dashboard in June 2021. At the 2021 United Nations Climate Change Conference (COP26) in Glasgow, Scotland, India announced 5 ambitious targets to fight climate change. India will take its non-fossil energy capacity
to 500 GW by 2030, will meet 50 % of its energy requirements from RE by 2030, will reduce the total projected carbon emissions by 1 billion tons till 2030, will reduce the carbon intensity of its economy by more than 45 percent by 2030 and will achieve the target of Net Zero by 2070.
The market for SWM in India can be segmented into various categories. The treatment and disposal segments are expected to witness significant growth during the forecast period due to the increasing focus on sustainable waste management practices. This sector comprises both public and private entities providing waste related services. The concept of circular economy has emerged as a key driver for the waste management market.
While the circular economy concept is relatively new to India, its gaining prominence rapidly. By aligning with circular economy principles, businesses not only contribute to environment conservation, but also position themselves at the forefront of a market that values sustainability. As circular economy initiatives gain traction, businesses that prioritize these principles are likely to experience sustained growth and market relevance.
WtE plants effectively manage MSW by alleviating strain on limited landfill space and addressing the growing waste generation challenge. Such plants also create job opportunities, support the local economy and livelihoods, reduces reliance on fossil fuels, a diversified energy mix and enhanced energy security. By harnessing untapped waste resources, reducing greenhouse gas (GHG) emissions, alleviating health risks, and combating climate change, WtE aligns with the Sustainable Development Goals and promotes a circular economy.
Company Overview
JITF Urban Infrastructure Ltd. ("JUIL") is largest WtE developer in India with portfolio of 111 MW. JUIL has robust footing in Indian Waste to Energy and Waste Management Space with more than 13 years of experience. JUIL operates largest WtE Plant in Delhi since last 13 years. JUILs all projects are eligible for Renewable Certificate Mechanism (REC) and Clean Development Mechanism (CDM) benefits. JUIL meets all the environmental norms as desired by Indian Government for operating WtE Projects. The Company is fully aligned with the goal of GOI "Swachh Bharat Mission".
JITF Urban Infrastructure Limited (JUIL) is the pioneer and the largest developer in India in Municipal solid waste (MSW) based Waste to Energy (WtE) plant domain. JUIL has made significant strides in developing the MSW based waste to energy business. The Groups vision is in coherence with the Swachh Bharat Mission (SBM).
JUIL is the holding company for development of MSW based WtE projects on Built, Own, Operate and Transfer (BOOT) model. The current portfolio comprises of projects with approximately 111 MW capacities in Delhi, Andhra Pradesh, Gujarat and Rajasthan.
Projects of 78 MW capacities are Operational and balance 33 MW projects are under implementation. At peak level, it will be able to process app. 15000 TPD of MSW which would be resulting in saving of 17 Lacs tones of emission of CO2 and other gasses per annum leading to a better environment.
JUIL implemented the India first MSW based WtE project, at Okhla (Delhi) in Sep 2012. The project is currently processing approximately 2000 MT MSW per day while generating approximately 23 MW power. Okhla WtE plant with capacity of 23 MW has generated a revenue of Rs. 69.4 crores during the FY 2023-24. It has processed about 6,47,960 MT of MSW during FY 2023-24 and converted it into greener energy over 165.2 million units out of which about 141.5 million units were exported to the grid, compost over 988 tons and recyclables above 736 tons. Guntur plant and Visakhapatnam plant generated a revenue of Rs.71.37 Crores and Rs. 56.27 Crores respectively during the FY 2023-24.
Guntur plant is successfully generating power with PLF between 90% to 100% and exporting to the Grid. Guntur Plant has processed 3,19,392 MT of MSW and 51,609 MT of RDF during the FY 2023-24 which was converted into green energy and generated 133.11 million units of power out of which about 115.46 million units was exported to grid. Guntur Plant has treated 50,5585 KL of leachate since August 2021 which would have otherwise caused contamination of Ground water and the treated water is being used for green belt development.
Visakhapatnam plant has processed 3,31,424 MT of MSW and 99,102 MT of Refuse Derived Fuel during FY 2023-24 and converted it into greener energy over 122.985 million units out of which about 106.856
million units exported to the grid. It has also treated 23398 KL of leachate during the FY 2023-24.
15 MW Waste to Energy plant at Ahmedabad is in advanced stage of commissioning activities and is expected to achieve Commercial Operation Date by June 2024.
As we embark on a journey towards the fulfillment of vision set by Honble Prime Minister of being a developed nation in the next 25 years, the disposal of Waste in a scientific manner has to be a stepping -stone towards the goal. JUIL as the largest developers and operators of WtE projects in India firmly believe that the generation of power and revenue therefrom remains the by-product of the larger and far more significant objective of Waste Disposal in a scientific manner.
Rail wagon fabrication and manufacturing Business: Jindal Rail Infrastructure Limited (JRIL)
Rail freight is an important business segment for many rail operators as its much more profitable than passenger carrier segment. Majority of the demand for freight wagons is comprised of replacement units as the overall fleet size has remained constant for many years now. The Rail Freight Transport Market size is expected to grow from USD 398.93 billion in 2024 to USD 509.98 billion by 2029, at a CAGR of 5.04% during the forecast period (2024-2029).
Intermodal transportation, which involves the use of multiple modes of transportation (e.g., rail and truck), has been gaining popularity. Railroads play a key role in intermodal logistics, offering an efficient and cost-effective solution for moving freight over long distance. Several significant factors, such as the growth of the worlds population and continued urbanization, which contribute to an increasing demand for rail freight services, strongly influence market growth.
Asia-Pacific Leads the Rail Freight Transport Market: An increase in demand for freight capacity is expected to drive the growth of the railway infrastructure market in Asia-Pacific. However, high capital requirements, lack of technology infrastructure and consistency in developing countries, and high overhaul and maintenance costs hinder the markets growth.
Among all the countries in Asia-Pacific, India is expected to have a positive outlook due to government support. The government of India has focused on investing in railway infrastructure by making investor- friendly policies. It has moved quickly to enable Foreign Direct Investment (FDI) in railways to improve infrastructure for freight and high-speed trains.
India is among worlds biggest freight wagon market. Indian Railways freight performance is on a remarkable upward trajectory, with revenue of around Rs 2.56 lakh crores and freight loading surpassing the estimated 1580 million tonnes. This success is further underscored by the freight transport unit, NTKM (Net Tonne Kilometer), which has witnessed an impressive growth rate of 10 percent.
There has been a concerted action in India for a modal shift from road to rail. The challenges of attracting more cargo to train with a focus on expanding the railway network have been progressively addressed by Indian Railways.
Rail freight transport is critical in supporting a countrys economic performance due to its paramount role in ensuring a seamless and efficient flow of goods locally and across borders. Rising freight volumes, infrastructure development, and adoption of sophisticated technology drive market growth. The railway sector in India aims to contribute about 1.5% to the countrys GDP by building infrastructure to support 45% of the modal freight share of the economy.
Indian Railways have recently prepared a National Rail Plan (NRP) for India - 2030 to create a future ready Railway system by 2030. The objective of the Plan is to create capacity ahead of demand, which in turn would also cater to future growth in demand right up to 2050.
Unlocking Growth Potential: With strategic initiatives like the New Logistics Policy and PM Gati Shakti, enhancing multimodal connectivity infrastructure, rail freight is poised to transform the express delivery industry, offering a sustainable alternative to road transport. This shift aims to catapult freight traffic from 1.1 billion tonnes in 2017 to 3.3 billion tonnes by 2030. Indian railways remarkable 7.5% increase in cargo transported in 2022, totalling 1,497 million tonnes, aligns with the National Rail Plan Vision-2030s goal to raise rails freight share from 31% to 44% by 2051.
Overview of Wagon Industry in India Wagon Market and Demand:
Indian Railways is Worlds fourth largest railway system and is witnessing robust growth driven by massive investments in Railway infrastructure creation by Government of India. Expansion and electrification of Railway tracks, investments in rolling stocks, improvements in signaling capacity, and completion of Dedicated freight corridors (DFCs) are being prioritized.
Over past decade Ministry of Railways has enacted favorable policies such as General-Purpose Wagon Investment Scheme (GPWIS), Liberalized Wagon Investment Scheme (LWIS), Special Freight Train Operator (SFTO) etc. to attract greater private sector investment into the Railways sector. As a result, Railways freight loading has reached record 1,512 mark in 2022-23 and was expected to increase to more than 2,024 MT during 2023-24.
National Rail Plan envisages increase in Rail modal share in Indias freight transport from 25% (1,162 MT) in 2019 to 44% (6,885 MT) in 2051.
Demand for wagons required to meet growing rail freight traffic is projected to increase at CAGR of 4.14% over 33-year period from 2018 to 2051. And for period between 2018 and 2031, the demand for wagons will grow more than 20,000 wagons per year as per following table:
Particulars | Demand for Rail Wagons from 2018 to 2051 | ||||
2018 | 2026 | 2031 | 2041 | 2051 | |
Total Wagon Demand | 279,875 | 407,770 | 545,225 | 779,071 | 1,068,130 |
CAGR 2018-2031 (%) | 5.26% | ||||
Wagon Demand per annum 2018-2031 | 20,412 | ||||
CAGR 2018-2051 (%) | 4.14% | ||||
Wagon Demand per annum 2018-2051 | 23,887 |
Ministry has set an ambitious target to achieve cargo loading of 2,024 million tonnes by year 2024 and 3,167 million tonnes by 2031. Induction of new Railway wagons into the service by IR is essential to meet this Policy objective. Ministry of Railways is cognizant of prevailing deficit in terms of wagon availability and realizes that procurement of wagons by IR needs to be urgently ramped up to achieve higher cargo loading. Accordingly, IR has placed orders for procurement of approx. 75,000 wagons in May 2022 and IR is planning to procure 60,000 wagons in upcoming years.
The number of new wagons added by Private sector companies investing in wagons through various IR Schemes such as CTO, LSFTO, AFTO, GPWIS, WLS etc. has been steadily growing over the years and presently accounts for about 30-40% of new wagons added on the entire IR network. There is growing interest among private companies to invest in special purpose and high-capacity wagons such as Coil carrying wagons, Automobile wagons, Container Flat wagons, wagons for Bulk Cement & Fly ash and Flat wagons for finished steel products. Demand from Private sector customers is playing a crucial role in enhancing IRs freight loading capacity and expected to remain robust over near to medium term.
Challenges
For wagon makers, soaring steel prices, shortage of rail wheels in the backdrop of the Russia-Ukraine war, have led to a different set of challenges that have constrained capacities in the current environment. While the freight sector shows promising growth, Indian Railways faces certain identifiable infrastructural bottlenecks. These include outdated tracks, inadequate terminal facilities, and connectivity issues. Such constraints only prove to impede efficiency and restrict the capacity of rail freight operations, undermining the competitiveness against other modes of transportation. Addressing these challenges is pivotal to enhancing the railways operational capabilities and fostering sustainable growth.
Company Overview
Incorporated in 2007 and in commercial operations since 2012, Jindal Rail Infrastructure Limited (JRIL) is a leading Railway Rolling Stock manufacturer, supplying different types of Freight wagons and Special- purpose cars to Indian Railways, Private sector & Export markets, complying to Indian Railway norms and International Standards. The plant is spread across more than 120 acres of land adjacent to Miyagam Karjan Railway station and is in the catchment area of DMIC (Delhi Mumbai Industrial Corridor).
JRIL manufactures best-in-class Rail Freight Cars for Indian Railways, Private Sector and Export markets. It has a Capacity to produce 3,000 freight cars per annum. It has 2 full length Railway Sidings with connectivity to IR network. JRIL meets Pre-Qualification criteria for all major Domestic and International wagon tenders. JRIL employs Highly Experienced Design & Engineering team for developing new designs for commodity-specific Freight Cars. Since its inception in 2012, JRIL has supplied more than 8,000 freight cars of various specifications in India & overseas.
JRIL has delivered strong business performance and achieved total revenue of Rs. 750.11 Crores during FY 2023-24, an increase of almost 110% as compared to last financial year.
Demand for freight wagons both from Indian Railways and Private Sector clients is increasing driven by robust growth in Railway sector. JRIL will benefit from favorable outlook of wagon industry as growing demand for wagons will increase companys capacity utilization, support its operating profitability, and enhance its competitive positioning.
JRIL has strong order-book from Private sector customers and expects to receive more orders in coming months, providing clear revenue visibility for FY 2024-25 and beyond. JRIL has excellent in-house wagon design and engineering capabilities which enhances its competitive positioning in the market.
Since 2012, JRIL journey has been defined by milestones: from Indian Railways orders to diverse industry innovations, like specialized wagons for steel, auto and cement. Our footprint is growing through strategic ventures with Industrial conglomerate and RDSO. JRIL has achieved export success with Gondola Wagons and innovative coil multi-purpose wagons for domestic market.
RISK MANAGEMENT
Risk Management is a process of identifying the risks, analysis of its effect on the business operations of the Company, measures to be taken to mitigate such risks. As a business enterprise the Company is exposed to various risk some of which are identifiable and can be mitigated through defined Internal Control Mechanism. However, there are certain risks which cannot be predicated and are unascertainable at a given point of time.
These can be mitigated through the experience inherited by the Company and its management over the period. The Company has set up an elaborate system for identifying and mitigating the risk associated with the nature of businesses undertaken by the Company which may threaten the existence of the Company. At senior management level roles and responsibilities of all the employees are well defined to facilitate timely identification and mitigation & management of the risks. We work in an environment where risks to the business and operations are evaluated regularly and suitable necessary steps are initiated by the Management to mitigate and alleviate such risks to the best possible way.
FINANCIAL PERFORMANCE
During the Financial Year, Company achieved Gross Revenue of Rs.320.81 lacs against Rs. 285.72 lacs achieved during the previous year. The net profit for the Financial Year is Rs.17.19 lacs as compared to Rs. 19.28 lacs in the previous year. At consolidated level the Company achieved Gross Revenue of Rs.333624.71 lacs against Rs. 160376.09 lacs achieved during the previous year. The net profit for the Financial Year is Rs.13045.51 lacs as compared to a loss of Rs. 9764.47 lacs in the previous year.
INTERNAL CONTROL AND INTERNAL AUDIT SYSTEM AND THEIR ADEQUACY
To ensure effective internal controls across business processes and systems, the Company has established a robust framework that is designed to provide reliable and quality assurance related to the Companys financial and operational information so that it can comply with applicable laws and safeguard its assets. The framework comprises both entity-level controls and business process controls. The adequacy and efficacy of these controls are evaluated on a regular basis.
To facilitate the same, following measures have been initiated:
The Company has put in place robust data security management.
The Company is employing data analytics in the internal audit.
All operations are executed through Standard Operating Procedures (SOPs) in all functional activities, and these are updated and validated periodically as per the business need.
The internal control systems are evaluated with respect to their compliance with the operating systems and policies of the Company across all locations.
Advanced technology is employed to enhance operational efficiency, a major component in forming adequate internal controls.
The Company has a robust risk management system which enables the organization to define the detailed risk associated with the business activities and putting the mitigation plans in place for all such identified risks.
The Companys Books of Accounts are maintained in SAP and transactions are executed through SAP (ERP) setups to ensure precision and accuracy in transactions and integrity and reliability in reporting. SAP is widely used to standardize internal control processes across the Company.
A Delegation of Authority (DOA) matrix schedule is integrated into the SAP setup which allows for approval of transactions and is periodically reviewed by the management and examined by auditors.
The Company has zero tolerance towards statutory non-compliance. Changes in the regulatory environment are regularly monitored.
Our Internal Audit department comprises of in-house Internal Auditors who are professionally qualified. The scope and its functions are covered under an Internal Audit Charter which the Audit Committee has sanctioned. An internal audit is carried out every year, based on an Annual Internal Audit Plan established on risk assessment and carries the approval of the Audit Committee.
The Company has a code of ethics in place in accordance with SEBI-mandated guidelines. However, no cases of violation have been recorded so far. The Whistle Blower Policy allows reporting incidents where the code of ethics is breached. Redressal, as well as monitoring of reported cases is undertaken by a designated authority.
The Internal Audit plan is approved by Audit Committee at the beginning of every year. The conduct of Internal Audit is oriented towards the review of internal controls and risks in the Companys operations.
Authorities, Responsibilities and Accountabilities have been fixed to ensure compliance with the policies and procedures laid down by the Management. Robust and continuous internal monitoring mechanisms ensure timely identification of risks and issues. The Management, Statutory and Internal Auditors undertake rigorous testing of the control environment of the Company.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
We at JITF Infralogistics Ltd. understand that employee satisfaction and happiness play a unique role in the growth story of an Organization. We make constant efforts to instill our Core Values i.e., Team-spirit, Openness & Fairness, Commitment to Excellence, Customer Focus & Care for people in the culture of the Organization. We continuously emphasize on strengthening employee-employer relationship by formulating effective strategies and improvising functional processes critical in achieving the Organizational goals.
We believe in Human Resource Development wherein pool of competencies are identified that are required for delivering tangible output and focus on development of required skill through continuous Training & Development. To improve technical knowledge and leadership skills, technical training is ensured along with behavioural training. The continuous development of our peoples capability is ensured through job rotations, functional trainings, and exposure to new technologies. This further helps in continuity planning for key positions to ensure a pipeline of qualified and talented people. The Company has devised a Policy for "Succession Panning" for identifying potential successors for the key positions in the organization. The organization considers its human resource as most precious/valuable asset.
JITF Infralogistics keeps reiterating its focus on investments in people through merit-oriented pay revisions and Promotions on yearly basis through a process "Target Based Performance Management System (TBPMS)". All the employees at all the Grades undergo a fair assessment and are appraised on their performances against their pre-decided KRAs. This process helps us in recognizing our "STAR" employees who can further be considered for Job enlargement, Succession planning etc., and also let us identify the employees who require further trainings, counselling or may be a change in nature of job. The company has "Performance Improvement Plan" in place for employees who are not able to perform up to the expectations in order to help and guide them to uplift their on-job performance.
The company works to empower women and has an effective framework in place for managing its workforce. It has established strict policies for preventing sexual harassment of women at work as responsible employers, giving them a powerful platform for efficient and prompt grievance redressal. The Company routinely holds awareness workshops to promote employee awareness and foster a safe and supportive work environment for all the females wherein they can work contentedly.
The Company has provided best amenities and working environment to all the employees like, best of medical facilities, transportation, subsidized cafeteria, cultural and sports activities, festival celebration, etc. Also, we believe that our responsibility extends beyond our employees and goes till their families as we continuously work for their well-being and secured life. To provide a secured and good quality of life, we have covered all our employees under best of Insurances which secure both employee and his/her family and regular medical camps/ awareness talks/ life skills talks are conducted for employees and their families as well. All of these initiatives help in achieving a work-life balance for employees and creating an open and caring culture within the organization. Our winning workplace culture can be witnessed by the lower attrition rate and higher level of satisfaction amongst the employees
INFORMATION TECHNOLOGY
Information technology is indispensable for a companys smooth functioning and sustainable efficiency, particularly in todays dynamic technological landscape. To stay ahead in this rapidly evolving environment, the Company has deployed SAP ERP across all its business locations in India. Additionally, recognising the evolving needs of modern technologies, the Company is gearing up to implement Artificial Intelligence to enhance accuracy, efficiency, and flexibility within its operations.
The utilisation of SAP ERP has been instrumental in enhancing operational efficiency, leading to almost zero downtime for the Company in 2023-24. This comprehensive system is utilised across various
functions including sales, logistics, procurement, production, maintenance, projects, HR, and MIS. A resilient IT infrastructure is crucial for managing and recovering from outages swiftly, thereby ensuring uninterrupted service delivery. The Company has implemented a robust disaster recovery setup to minimise data loss and a continuous monitoring mechanism to prevent potential outages.
Ensuring the security of its IT landscape is paramount for the Company. To mitigate external threats, the Company has adopted advanced security measures including Next Generation Firewall, Virtual Local Area Networks, and Managed Detection and Response solutions. Regular communication is disseminated to all IT users to raise awareness about prevalent threats and best practices for self-safeguarding.
In addition to SAP ERP, the Company has leveraged various applications to digitise different processes such as claims and reimbursements. Furthermore, by utilising Microsoft 365 for email and office tools, the Company ensures the security and resilience of its domains and websites against cyber threats. Through the adoption of cutting-edge technology, the Company continuously evaluates risk performance, fosters employee engagement, and enhances internal system controls, thereby ensuring its IT infrastructure remains robust and future-ready.
HEALTH AND SAFETY
The company understands the importance on health and safety of its employees and the environment it operates within the organization. The company endeavours to provide a safe, transparent, conducive, and secured work environment and invest in the learning and development of its team members so that they can develop their competencies while creating a talent pool for the Company. The well-experienced members of our EHS segment are constantly and tirelessly working towards making our organisation Accident-free. Some of the health and safety protocols and procedures that are inculcated in the system:
Regular safety training sessions to each employee to equip them with knowledge and information regarding safety standards and procedures.
Conducting regular safety audits to identify potential workplace risks and hazards and chalking out preventive measures.
Employees working at shop floor are provided with personal protective equipment (PPE) to shield themselves from potential dangers like falls, cuts, burns etc.
The Company believes in always being ready and equipped to respond to emergencies like fires, natural catastrophes, and medical problems by developing well-structured plans and protocols.
The Company deploys environmentally friendly practices to minimise pollution and lessen its adverse effects on the environment.
The Company ensures that it adheres to all the safety rules and guidelines as prescribed by the various government authorities.
CAUTIONARY STATEMENT
The Statement in this Management Discussion and Analysis report, describing the Companys outlook, projections, estimates, expectations or predictions may be "Forward looking Statements" within the meaning of applicable securities laws or regulations. Actual results could differ materially from those expressed or implied.
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